Item Number: 15
City Council / Board of Directors
Written Communications
Meeting of: April 15, 2025
Submitted By:
James Murawski, Airport Director
Subject:
Standard Sublease Agreement for Building 682C by and between the Southern California Logistics Airport Authority and Anduril Industries, Inc.
Recommendation:
That the Southern California Logistics Airport Authority (“SCLAA”) Board of Directors:
(1) Approve entering into a Standard Sublease Agreement for Building 682C (“Agreement”), by and between the SCLAA and Anduril Industries, Inc., (“Anduril”); and
(2) Authorize the Executive Director to execute said Agreement.
Fiscal Impact:
The Agreement presented herein will generate approximately $655,134.80 in gross lease revenue over the initial term (May 01, 2025 – April 30, 2028). The table below outlines the fiscal impact of the initial 3 years of the Agreement.
FY 2024-25
May 25 – June 25
FY 2025-26
July 25 – June 26
FY 2026-27
July 26 – June 27
FY 2027-28
July 27 – April 28
$35,326 $213,015.78 $219,406.25 $187,386.77
A budget amount has been established in account 4501116A-45200 for fiscal year 2024- 2025 for the resulting revenue, therefore, no additional revenue appropriation is required with this action. Future appropriations for the subject Agreement will be considered at the time the annual budget is approved.
Strategic Plan Goal:
The City of Victorville Strategic Plan 2023-2026 identifies multi-year strategic goals and various strategies to work toward achieving those goals. Goal A fosters fiscal health 5 7
0 through disciplined long-term planning, cost control, increased revenues, and cost recovery.
Background:
Anduril Industries, Inc., is an American defense company that specializes in autonomous systems. It was founded in 2017 by inventor Palmer Luckey and a team of founders formerly with Palantir and SpaceX. Anduril raised $1.5 billion in their latest funding round, six months ago, from some of the most renowned investors in the global technology landscape, including: Andreessen Horowitz; Founders Fund; General Catalyst; Lux Capital; Thrive Capital; Valor Equity Partners; and Elad Gil, among others. As of February 2025, the company has a valuation of $14 billion. Moreover, the company is in discussions to raise additional capital that is expected to bring its market valuation to $28 billion.
Anduril states that at its core, it is a defense products company. Unlike most defense companies, Anduril does not sit idly waiting for its customers to tell them what they need.
Anduril identifies problems, and privately funds research and development while working to break into large programs of record and sells finished products off the shelf in order to get relevant technologies into the hands of warfighters as quickly and effectively as possible. Ideas are turned into deployed capabilities in months, not years, saving the government and taxpayers money along the way. Military veterans make up more than 20% of Anduril’s team and their defense experience is leveraged to ensure that the company’s products meet the needs of servicemen and women in the battlefield.
Anduril’s family of systems is powered by the proprietary Lattice OS, an artificial intelligence powered open operating system that brings autonomy to the Defense Department’s toughest missions. Lattice OS connects autonomous sensemaking and command and control capabilities with open, modular, and scalable hardware components for a layered family of systems approach. Some of the major systems that Anduril has deployed or publicly acknowledged to be developing are the Sentry Towers, Roadrunner, Ghost Shark XLAUV, Dive LDAUV, Altius and Fury.
Anduril announced plans to build a massive, 5 million square foot manufacturing facility called "Arsenal-1" in Pickaway County, Ohio, with a projected investment of nearly $1 billion, creating over 4,000 jobs by 2035. This project is considered one of the largest single job creation initiatives in Ohio history, with the state offering significant tax incentives to attract Anduril to the area, aiming to bolster the state's defense manufacturing capabilities.
When production begins next year, the company will start manufacturing three of its autonomous air systems products, Fury, Roadrunner and Barracuda, Anduril said in an email to Manufacturing Dive, a periodical. The company has plans to expand into other products as it builds out the plant and new facilities come online.
The facility at the Southern California Logistics Airport (“SCLA”) will support Anduril’s Group 5 autonomous air vehicle program, called Fury, a single engine jet drone. 5 7
0 Additionally, Andril will perform related independent research and development, including certain contracted efforts with other defense contractors.
Discussion:
Anduril became a tenant of the SCLA March 2024, when it leased Buidling 685C. Anduril expanded its footprint at the SCLA by leasing Buildings 868, 868A, 869 and 835 in March 2025, and looks to expand again by leasing Building 682C which is adjacent to 685C.
The Agreement will allow Anduril to grow its footprint at the SCLA to perform aircraft assembly, maintenance, calibration, storage, and preparation for testing in support of Anduril’s Group 5 autonomous air vehicle program, an autonomous jet powered aircraft.
Anduril is creating a hub for their research and development and flight testing at the SCLA.
The proposed Agreement for the Building 682C entails an initial term of three-years with a commencement date of May 1, 2025. The Agreement also contemplates one additional, three-year, option term. The Subleased Premises consist of Building 682C, which is comprised of hangar, office space, outdoor storage, vehicle parking and ramp space. Anduril has agreed to pay $17,663 per month with an annual 3% inflator. This amounts to the summation of Building 682C rent in the amount of $16,263 which is $1.50 per square foot; outside storage and vehicle parking space rent in the amount of $500 which is $.03 per square foot; ramp space rent in the amount of $900 which is $.01 per square foot. The rate for the hangar and office space is the highest rate the SCLA has for similar SCLA buildings. The storage, vehicle and ramp space is comparable with similar SCLA outdoor space.
Because the Standard Sublease Agreement will increase local employment, increase aircraft activity, increase operations, and produce a steady revenue stream, staff recommends that the Southern California Logistics Airport Authority Board approve the Standard Sublease Agreement with Anduril Industries, Inc., for Building 682C and authorize the Executive Director to execute said agreement. Such approval is being requested, subject to any minor, non-substantive modifications to the Sublease Agreement as approved by the Southern California Logistics Airport Authority Legal Counsel and the Southern California Logistics Airport Director.
Staff remains available for any questions or comments you may have.
JM/lf
Attachments: A. General Site Map
B. Standard Sublease Agreement for Building 682C